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After The Bell: Nifty heads towards 14k, what should investors do on Wednesday?

Markets are still rewarding those who focus more on the selection of stocks and the trend will continue, say experts.

December 29, 2020 / 05:21 PM IST
Representative image.

Representative image.

Indian market closed in the green for the fifth day in a row to push benchmark indices to new highs, with the BSE Sensex hitting 47,714 and the Nifty50 13,967.

The Bulls remained in control despite some profit-taking at higher levels. The Nifty50 is just 68 points shy  of the crucial psychological level of 14,000.

Let’s look at the final tally on D-Street – the Sensex closed 259 points higher at 47,613 while the Nifty50 rose 59 points to 13,932.

Sectorally, the action was seen in stocks like banks, finance, IT, and FMCG stocks, while profit-taking was visible in metals, power, energy, and healthcare names.

On the broader markets front, the S&P BSE midcap index fell 0.07 percent, while the smallcap index closed with gains of 0.16 percent.

Close

Experts say investors should remain cautious ahead of the December series expiry and be stock specific.

“We believe the recent buoyancy in the banking pack would help the index to maintain the prevailing bias. Markets are still rewarding those who are focusing more on the selection of stocks and expect the trend will continue ahead also,” Ajit Mishra, VP-Research, Religare Broking Ltd told Moneycontrol.

“Needless to say, participants should maintain some caution, especially in the leveraged positions due to scheduled derivatives expiry ahead,” he said.

Here is what experts think that investors should do on December 30:

Shrikant Chouhan, Executive Vice President, Equity Technical Research, Kotak Securities

The Nifty 50 hit a new high and gained for the fifth consecutive session. The index opened higher and quickly moved to 13,967 but later it received support only from financial stocks.

The Bank Nifty is 1,244 points away from its previous highest levels and it seems that it is set to surpass it with the support from PSUs and private banks. On a daily basis, the Nifty closed above 13900, which is positive for the market and we expect it to stabilise at these levels. Also, it could invite buying at major supports.

The Nifty would trade between 13,800 and 14,100 for the next two days. Keep long stop loss at 13,700 for the same. Along with financials, we need to keep a close eye on metal and cement stocks.

Kanika Agarrwal, Co-founder and Chief Investment Officer, Upside AI

It was a volatile day for the markets. The Nifty went up led mainly by financials, while the broader market was flat. For the next quarter, we remain bullish on value stocks and small caps.

Key trends we are tracking are the vaccine rollout, reaction to new strains and the government commentary on the budget.

Given the year-end and lower volumes, continue to expect volatile days going into the New Year, with pockets of stocks driving movement.

Rohit Singre, Senior Technical Analyst at LKP Securities

One more positive session and index closed the day at 13,927 with gains of half a percent, forming a small Doji candle on the daily chart. The index has formed a good base near 13,800, holding above said levels we may see a 14k mark in the Nifty soon, which is an immediate hurdle on the higher side.

The Nifty Bank looks more lucrative at the moment as the index has witnessed a fresh breakout above the 31,000-mark. Going forward, it will act as fantastic support and if it manages to hold above the 31,000, we may see a good move in the Nifty Bank towards the 31,500-32,000 zone.

Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services Limited

The Nifty formed a bullish candle on the daily scale and is making higher lows from the last five sessions.

The Nifty has to continue to hold above 13,800 to witness a fresh rally towards 14,000 then 14,200 zones. On the downside, major support exists at 13,777 and 13,700 levels.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Kshitij Anand is the Editor Markets at Moneycontrol.
first published: Dec 29, 2020 05:21 pm

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